Financial Resource

Ok so here’s the question why would you pay for debt advice when you can get it for free? Two of the largest companies that fall into the debt charity sector are Payplan and the CCCS (Consumer Credit Counselling Service). Both of these companies do not charge any fees whatsoever, a totally free service, so why on earth would you pay for debt advice and use a company like my own for example AMS, a debt management company that charges a fee (albeit some of the lowest in the UK)?

Before we explore that further I want to go back many years ago, before I got involved with debt management , in fact much further back to when I was a teenager ( I am 44 now) and how I personally experienced life in debt from the other side of the fence. It was not my debt, it was my parents who needed to get out of debt, but unfortunately it swallowed them up and they lost their house. Their house; they had lived in for approaching 20 years, it was a right to buy council house; it perhaps wasn’t much but it was to my parents it was “home”; was repossessed and they were re-housed in a council flat.

 A councill flat where an elderly gentlemen, that by all accounts was a hermit that smoked 100 fags a day, had lived (my late mum was an asthmatic and suffered severely). When my mum opened the door she just sat there and sobbed. Now at the time I never really understood what they could have done to have stopped this situation from happening. However now I know if they had taken the right action they would have kept that house.

I cannot comment on the advice they received because I was not present, but I do know they visited the Citizens Advice on many occasions. I do know that they borrowed more money at exactly the wrong time. I do know that they paid non priorty debts before priority debts and I do know that the CAB, according to my father’s opinion, did them absolutely no good at all (although I know a lot of people put a lot of effort in for no financial reward at the CAB I am definitely not having a go at them, they do their best, but were they just unlucky? and what has that got to do with Payplan and the CCCS?………….

 ……….Well nothing actually other than to let you understand that I can see what debt does to families and I really understand on a deep emotional level what it feels like.

Well as you may or may not know the Citizens Advice Bureau heavily promotes the services of Payplan and CCCS, why because they are free.

So how can they do it for free? By all accounts the directors of these debt charities earn significant salaries with a capital S, drive extremely nice company vehicles, receive significant rewards. The offices need to be paid for, the staff need to be paid, fed and watered etc etc etc……so how do they fund this? a money tree, a genie in a bottle, generous donations from some of the worlds richest philanthropists ? no unfortunately the last time I looked it was only Jason that found the golden fleece hanging from a tree. The funding comes directly and almost wholely from the worlds major lenders, the banks and the credit card companies……….as they understand the intrinsic nature of debt better than any other type of organisation in the World ! according to the debt charities websites, check it out for yourselves.

No banks in my opinion; and let me express that this is my opinion and you may have gathered I have one, understand better than any other organisation in the world how to make money. Fullstop. Banks are designed to make money and the horrific mis-selling of payment protection insurance that has been going on systematically taking advantage of the people of this island for the last 10 years really shows you what the worlds bankers are capable of. Who invented the credit crunch? Who lent money to people with absolutely no ability to pay it back? Who sold insurance to people that could never claim? Who are now getting nice million pound bonuses again……….yes our friends “the bankers”.

So why would you fund debt management companies that reduce payments if you were a bank or a credit card company? Remorse, guilt, sense of public duty or are there any commercial benefits that you can control the collection of money back into your coffers better or you can get more pence in the pound back , would you want an input with regard to credit control and collections? or is that the twisted and biased few of the director of a commerical debt management company such as myself as of course I would say that wouldn’t I ?

To be truthful I don’t really know,does anybody, but I think its right that questions are asked when the PR machines of the banks do all they can to tell you that commercial debt management companies are the devil incarnate, and they are quite right, there are lots of debt management companies that don’t deserve or have already lost their consumer credit license (this enables them to offer debt advice) however there are some very good debt management companies that charge a fee, and I would like to think we are one of them.

What do you want from a debt management company if your in debt? I would say you want 5 main things. Firstly you want the very best advice and the right debt solution for your specific situation whether or not that is a debt relief order, a debt management plan, IVA, Bankruptcy, re-mortgage, consolidation loan, restructuring, negotiated setttlements, debt reduction etc etc. it needs to be right for you.

Secondly you want to get that best advice quickly before the situation gets out of control.

Thirdly you want to get out of debt for the least amount possible and in the quickest time (potentially, but this depends on age, life goals and so much more).

 Fourthly you want to understand on a deep level how you got into debt and what lessons you can learn to stop this situation from happening again in the future.

Finally you want to be able to see a clear path of the future and most importantly for the stress and anxiety to dissapear and be replaced with “hope” – as a very famous American motivational speaker and devout Christian Zig Ziglar say’s – “If there is hope in the future there is power in the present!”

Now if you can add to this a full financial review looking into all the provisions that should be part of everyone’s essential expenditure such as insurance, pension provision, life insurance, income protection, critical illness , wills, etc etc……..and on top of that do a full review looking at saving money wherever that can be saved with regard to housekeeping, utilities, mobile phones, etc etc……….and on top of that now look at any payment protection insurance that has been sold by the banks and the credit card companies and where it has been mis-sold win back redress to get your client out of debt quicker……….and on top of that now negotiate and hard with that redress won from the mis-sold ppi to get positive full and final written settlements and clear outstanding debts for less, (every collection company has a figure that they are happy to effectively sell that debt for)………and on top of that now look at life coaching to help you client eliminate any potential limiting beliefs that they may or may not have had to help them achieve new positive financial goals………….and now on top of that be available for them 7 days a week…..and what about a face to face call……….and what about helpling them with tax debt, council tax arrears, understanding benefits available to them, doing everything you can to  get interest and charges stopped…….what about on top of that sending them monthly statements, doing 6 monthly reviews instead of 12 monthly, what about dealing with every piece of correspondence and phone calls from creditors on the same day they are received.

I spoke to a lady that worked for one of these “free” no fee debt management companies, she was doing 9 appointments a day, yes 9 appointments a day – throw that into a 8 hour day with an hour for lunch. Do you think you could fit all of this in? She couldn’t but maybe she was just not very good. Actually she was lovely, her heart was definitely in the right place. She was simply overworked and underpaid, in her opinion and actually mine as well……..but she would say that she was sitting in front of me having an interview at the time !

Anyway I will leave you with one last thought. I am extremely lucky; and I am honest to say a massive hypocrite as I think of myself as a devout socialist, that my daughter goes to one of the very best schools in Nottinghamshire, in fact it is one of the very best schools in the UK. The Nottingham Girls High School look them up.

 Going there will definitely help you get the very best possible grades, the teachers are great, the food is great, the education is great, the culture is great, the coaching is great……..but it costs. I send her there because I want her to have the very best education I can give her and she has the discipline to excel in that environment, now I could get education for free so why should I pay?………….now do the bankers, the politicians, the top civil servants , the lawyers have a problem paying for education when they can get it for free? Answers on a postcard ;0)

Tags: CAB, capital, CCCS, comes, consumer, consumer credit counselling, consumer credit counselling service, credit, debt, debt management company, debt management plans, elderly gentlemen, Fees, house, Management, plans, priority debts, question, Service, web